OLYMPIA – The Washington State Department of Financial Institutions (DFI) has obtained a receiver to take over Hartman Escrow, Inc., of Tukwila. DFI, which had taken control of the business and property on July 31, 2012, found it could not legally operate the company in the complete absence of a trust account. The receiver will be able to manage the affairs of the company subject to court supervision, and will not be limited by the absence of a trust fund.
Orse & Co., led by Eric D. Orse, President, is a workout company specializing in crisis management to preserve, maximize, and dispose of assets for the benefit of consumers and creditors. Karr Tuttle Campbell, a Seattle law firm, has extensive experience in receiverships. Attorney Diana K. Carey, Chair of Karr Tuttle’s Creditors’ Rights and Insolvency Practice Group, will provide legal services to Orse & Co. Carey and Orse have worked together on past high-profile bankruptcy cases, including Wade Cook Financial Corp. and Frederick Darren Berg, as well as numerous receiverships involving financial misconduct. Both Carey and Orse are trustees of CENTS (Consumer Education and Training Services), a non-profit which provides financial education to consumers in the Puget Sound area.
In the Petition seeking appointment of a general receiver, DFI identified some of its preliminary findings in the on-going investigation and examination of Hartman Escrow and its President and sole owner, Lori L. Andrew, including that Ms. Andrew had transferred more than $400,000 of Hartman Escrow assets to her personal bank account, including escrow trust funds; authorized more than $400,000 in non-business-related expenses; and converted more than $200,000 in escrow trust funds to her personal use.
“Upon discovering the misuse of consumer trust account funds in this case, DFI took extraordinary and immediate measures to protect consumers from additional financial harm,” DFI Director Scott Jarvis said. “It is our hope now, with a receiver in place, restitution will be complete for all affected parties.”
“Hartman Escrow has both Fidelity and Errors and Omissions coverage aggregating to $2,000,000, along with more than $1.4M in funds frozen by DFI,” Division Director Deb Bortner said. “Though DFI has already received more than $900,000 in consumer and creditor claims, we hope that with the appointment of a receiver those claims, and the others we anticipate being filed, will be paid in full.”
Copies of the DFI Orders
Temporary Order to Cease and Desist 1